83 PCIB V FRANCO

G.R. No. 180069; March 5, 2014

Topic: Payment | Ponente: J. Peralta | Author: Enriquez

Doctrine: The creditor's possession of the evidence of debt is proof that the
debt has not been discharged by payment.

Facts:
1. Franco secured from PCIB Trust Indenture Certificates.
2. On the few occasions that Franco had visited PCIB to request for a status
on his investments, bank officers would normally pull out his ledger card
and show him the updated amount due him
3. Franco’s child had a leukemia. As a result, he spent a lot of money. Thus,
he turned to his Trust Indenture Certificates and started inquiring as to how
he could liquidate the trust.
4. To his surprise, he received a letter signed by PCIB’s counsel, Curato Divina
& Partners, in effect denying his request for payment by stating that due
to the conversion of all outstanding PCIB trust indenture accounts into
common trust certificates, all such PCIB trust indenture certificates have
been rendered null and void.
5. Thus, Franco filed an action for damages against Philippine Commercial
International Bank (PCIB).
6. RTC and CA ruled in favor of Franco. CA held that PCIB failed to adduce
any documentary evidence to establish the alleged fact that the four
trust indenture certificates were already paid or cancelled.

Issue/Held: Whether PCIB already paid Franco for the trust certificates? NO.

Ratio:
 Jurisprudence abounds that, in civil cases, one who pleads payment has
the burden of proving it. Even where the plaintiff must allege non-
payment, the general rule is that the burden rests on the defendant to
prove payment, rather than on the plaintiff to prove non-payment. When
the creditor is in possession of the document of credit, he need not prove
non-payment for it is presumed. The creditor's possession of the evidence
of debt is proof that the debt has not been discharged by payment.
 In this case, respondent's possession of the original copies of the subject
TICs strongly supports his claim that petitioner Bank's obligation to return
the principal plus interest of the money placement has not been
extinguished. The TICs in the hands of respondent is a proof of
indebtedness and a prima facie evidence that they have not been paid.
Petitioner Bank could have easily presented documentary evidence to
dispute the claim, but it did not. In its omission, it may be reasonably
deduced that no evidence to that effect really exist. Worse, the
testimonies of petitioner Bank's own witnesses, reinforce, rather than belie,
respondent's allegations of non-payment.